FEBRUARY 07, 2016

By Arun Deshpande

Here are my humble suggestions for the Union Budget, 2016.

EXPORT:

Time limit : Time limit for sanctioning Rebate / Refund / fixation of brand rate should be reduced to 60 days instead of 90 days from the date of submission of claim.

Validity of Letter of undertaking : shall be three years from the date of issue of it, in case of factories having continuous export or having export turnover of more than Rs. Two crores p.a.,

Submission of Copies of ARE 1/ ARE 2: Once in a month instead of submitting on day to day basis

Approval of input output ratio: Time limit for giving approval should be 30 days, in case of exports to Nepal or any other country

Advance intimation in case of export under ARE 2: this should be done away in case of exporters having permission to export under self-sealing and approved input output ratio. Anyhow department is not going to sanctioned rebate more than what was mentioned in approved input output ratio.

Excise:

ER 6 Return: filing of monthly return should be done away in case of engineering industry / motor manufacturer / OEM it is only a Non value added exercise for industry and department as well.

ER 1 Return: Filing of revised return should be permitted

Audit: Every year assesse has to have submit three years data / along with balance sheet / trial balance invoice copies and so on. Some commissionerate issued trade notices but officers are reluctant to follow it. CBEC should issue a circular to this effect.

No allegation of suppression / fraud etc. if the unit is audited every year.

Rate Increase / Decrease: Interest liability should be cast upon to the purchaser who gives price increase for more than 6 months period. If it is for less than six months period no interest liability but if it is more than six months then liability should be cast upon to purchaser.

Since, in case of price decrease purchaser deducting the money even before release of formal purchase order.

Input cleared as such: Audit parties are directing assessees to reverse service tax credit availed on input cleared as such, which is impractical / impossible thing and when there is no provision in the law, of course they always insist for such things

Time limit for receiving process goods CCR 4(5)(a) : Must be reduced to 120 days as I feel 180 days limit was given considering the transport /. Communication / technology available in 1986 since then there was no change in this time limit surprisingly department is also silent on this.

Reversal of cenvat on provisions : No reversal of Cenvat on provisions made during a financial year to as per standard accounting practice or policy adopted by the company. CENVAT should be reversed on write off provisions made at the end of the year only, and reversal should take place before 30 th of June every year.

Service Tax: No tax on Penalty imposed on supplier for breach of agreement, non-compliance since this is not an income truly speaking it is a loss since recipient has to re-arrange, reschedule many things in today's competitive and complex work. Also there should not be any service tax when employee leaves the organization and company recovers the notice pay.

Another issue is inclusion of value of reimbursement of various expenses / material supplied by recipient e.g. cement, steel etc. for the purpose of arriving taxable value of service. Otherwise also service tax is not payable if the service provider produced the VAT bill for use of such material.

Department should give in writing what effort they have made to recover money from the defaulter instead of sending garnishee notices to servicer receiver, particularly when the service provider is filing the return regularly or not filed the return for more than one year.